A 1 percent increase in the price of good W results in a 3 percent increase in the quantity demanded of good T. What is the cross-price elasticity of demand, and what kinds of goods are they?
A) 3; complements
B) ; normal goods
C) 3; substitutes
D) ; inferior goods

Question

A 1 percent increase in the price of good W results in a 3 percent increase in the quantity demanded of good T. What is the cross-price elasticity of demand, and what kinds of goods are they?
A) 3; complements 
B) ; normal goods 
C) 3; substitutes 
D) ; inferior goods

Quizplus · Accepted Answer

The Answer of A 1 percent increase in the price of good W results in a 3 percent increase in the quantity demanded of good T. What is the cross-price elasticity of demand, and what kinds of goods are they?
A) 3; complements 
B) ; normal goods 
C) 3; substitutes 
D) ; inferior goods

A 1 Percent Increase in the Price of Good W